LGT Navigator

Oil spikes as failed Middle East talks rattle markets

Energy prices surged and equity markets came under pressure at the start of the week after peace talks between the US and Iran broke down, with Washington preparing a naval blockade of Iranian ports and shipping in the Strait of Hormuz. Asian stock markets traded broadly lower on Monday as investors weighed the risk that a prolonged conflict and higher oil prices could strain global growth and complicate central banks’ inflation fight. The US dollar strengthened to start the week, with the US Dollar Index up 0.4%. Meanwhile, gold prices were softer, trading around USD 4720 per ounce, and bitcoin was trading slightly lower around USD 70,700.

  • Date
  • Auteur Shane Strowmatt, Senior Investment Writer
  • Temps de lecture 5 minutes

Iran map

Energy prices spiked and Asian equity markets traded lower on Monday as investors reacted to failed weekend talks between the US and Iran in Islamabad and the prospect of a US naval blockade of Iranian ports and shipping in the Strait of Hormuz. Brent crude rose about 9% to USD 104 per barrel and US benchmark West Texas Intermediate climbed more than 7% to around USD 102, fuelling concerns about prolonged economic strain from elevated energy costs. US President Donald Trump is reported to be considering renewed airstrikes on Iran despite having agreed to a two-week ceasefire last week. In the Asia-Pacific region, Japan’s Nikkei 225 was trading 0.7% lower, Korea’s Kospi was down 0.9% and Australia’s S&P/ASX 200 was 0.5% weaker. Hong Kong’s Hang Seng Index was 1.1% lower and India’s Nifty 50 was down 1.3%, while mainland China’s CSI 300 bucked the regional trend, trading 0.3% higher.

Markets eye key central bank and inflation data, with one eye on the Middle East

This week, market participants will continue to monitor the situation in the Middle East as a dense calendar of data releases and central bank communications provides fresh signals for global markets. In Europe, inflation remains in focus with euro-area inflation due on Thursday and investors watching ECB President Christine Lagarde's speech on Tuesday for any signs about the central bank's reaction to the recent spike in oil prices resulting from the Middle East conflict. China releases a broad set of data on Thursday, including first-quarter gross domestic product, March industrial production, fixed asset investment and the unemployment rate, offering an important update on the strength and balance of the country’s post‑pandemic recovery. In the United Kingdom, a batch of February indicators on Thursday - including monthly gross domestic product, industrial production and trade figures - will provide a snapshot of underlying economic momentum. From the United States, producer price inflation on Tuesday, regional manufacturing and industrial production data on Thursday, along with the Federal Reserve’s Beige Book on Wednesday will give investors further insight into economic conditions and the central bank’s assessment of the outlook.

On the corporate side, US financials will be in focus as major banks including Goldman Sachs (Monday), JPMorgan (Tuesday), Bank of America (Wednesday), and Morgan Stanley (Wednesday) report first-quarter earnings, offering an important read-through on credit quality, loan growth, and trading activity. In semiconductors, ASML (Wednesday) and Taiwan Semiconductor (Thursday) deliver their Q1 2026 results, which will be closely watched for signals on capex trends and the durability of the AI-driven demand cycle.

US inflation jumps as energy spikes

US consumer prices increased sharply in March, with the consumer price index rising 0.9% on the month and 3.3% year-on-year, as the Iran war drove a 10.9% surge in energy costs, according to Bureau of Labor Statistics data released on Friday. The annual inflation rate, which was in line with market expectations, marked an acceleration from 2.4% in February and was the highest since April 2024, with gasoline prices jumping 21.2% and accounting for most of the headline rise. Core inflation, which excludes food and energy, remained more subdued at 0.2% on the month and 2.6% year-on-year, slightly below economists’ forecasts, with declines in medical care, personal care, and used vehicles pointing to pockets of deflation. Energy prices had initially eased in April following the ceasefire announcement between the US and Iran, but have rebounded amid uncertainty about the agreement. US equities ended Friday’s session mixed after a solid week, with the Dow Jones Industrial Average falling 0.6% to 47,916.57 points, while the S&P 500 slipped 0.1% to 6816.89 points and the Nasdaq 100 added 0.1%, leaving weekly gains of about 3% for the Dow and 4.5% for the Nasdaq.

Swiss consumer sentiment plunges in March

Swiss consumer confidence deteriorated sharply in March, with the State Secretariat for Economic Affairs index dropping by 12.5 points from February to -42.9, according to data published on Friday. The mood among households thus fell to its lowest level since early 2024 and was 8.1 points weaker than in March last year, with the Iran war seen as the main factor weighing on sentiment. Sub-indices for expected economic development, expected financial situation and the suitability of the time for major purchases all slipped below their March 2025 levels, while assessments of past financial conditions were largely unchanged. The monthly indicator, which is based on a long-running survey series that began in 1972, captures expectations and experiences of private households rather than broader business activity. The Swiss Market Index advanced 0.2% on Friday.

German inflation accelerates on energy shock

Germany’s annual inflation rate rose to 2.7% in March, up from 1.9% in February and 2.1% in January, according to data released by the Federal Statistical Office on Friday. The increase, the highest since January 2024, was driven mainly by a 7.2% year-on-year rise in energy prices, with motor fuel up 20% and heating oil 44.4% as the Iran war and broader Middle East conflict pushed up crude oil prices. Food prices rose only 0.9% and overall goods prices were up 2.3%, while services prices increased a stronger 3.2%, reflecting notable gains in social protection, transport and catering. Core inflation, excluding food and energy, remained stable at 2.5% in March, with consumer prices rising 1.1% on the month as energy jumped 7.7% and package holidays, clothing and international flights also became more expensive. The Euro Stoxx 50 added 0.5% on Friday, while Germany’s DAX was essentially unchanged.

Corporate and economic calendar

Corporate news in focus: Quarterly figures from Goldman Sachs.

Economic data in focus: Bundesbank monthly report (12:00), Canadian building permits (14:30) and US existing home sales (16:00).

LGT helps you make informed investment decisions

Global economic and market trends at a glance

You can also follow us on Facebook or LinkedIn – or visit Insights and discover interesting background articles. If you have questions, a consultant from the bank will be happy to help you.

Imprint
Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.

LGT Navigator Markets firm as investors eye Iran ceasefire and US inflation Tous les articles LGT Navigator Markets mixed as traders look for Iran deal
Déconnexion
Inspirés par l’avenir depuis des générations
Nos newsletters - automatiquement up to date

Les newsletters LGT vous informent régulièrement sur les insights et les nouveautés dans les domaines de l'économie, de la finance et bien plus encore.

Inscription à la newsletter
Follow us
Scaling impact LGT Venture Philanthropy